1. Technical Field
The present disclosure relates to systems, methods and computer program product that monitor real property transaction data, and detects signs of potential improper activity. In particular, the system, method and computer program product
2. Description of the Related Art
A homeowner who is unable to pay their mortgage and is “underwater”, i.e. the home is worth less than the amount the homeowner mortgage, may seek a lender's permission for a “short sale”. A short sale of real estate occurs when the sale proceeds fall short of the balance owed on the property's loan. Often the lender decides that selling the property at a moderate loss is better than pressing the borrower who is already underwater and may not be able to afford the mortgage. Both parties consent to the short sale process because it allows them to avoid foreclosure, which involves hefty fees for the bank and poorer credit report outcomes for the borrowers. This agreement, however, does not necessarily release the borrower from the obligation to pay the remaining balance of the loan, known as the deficiency.
As the number of “short sales” has increased, so has the number of fraudulent activities related to “short sales”. A common technique usually involves real estate insiders (i.e. real estate agents/brokers) who broker a short sale between the servicer and a buyer who serves as a middleman at a below-market value. The insider subsequently brokers a quick resale of the property from the middleman to an arms-length buyer at market value. It is common to observe re-sales occur as soon as one day after the short sale closes with the original servicer. Because the real estate broker does not disclose to the servicer the higher value offer that should be available to them from the arms-length buyer, they are defrauded out of receiving the best price possible.